Can Luxury Survive This Economy?

The Wall Street Journal’s magazine, WSJ., asks a question we ourselves have been wondering: Can the luxury-retail market survive the recession and the resulting everything-must-go 70 percent off sales that consumers are growing accustomed to? When was the last time you paid full price for anything designer? If we think back to the big Saks sale last year, at first, everyone was scandalized at just how low the prices fell. And now, we expect it. Frankly, we won’t pay old-economy prices for our bags again.

So what will happen to the high-end stores of yore? The Journal doesn’t really answer this, of course. Who can, unless they have one helluva great Magic Eight Ball. But the article does look at the new world of shopping, which isn’t really new to most fashion fanatics. Net-A-Porter changed the way houses looked at web retail, after Natalie Massenet started bypassing runway shows and buyers — with RM and Halston selling directly on her site. And she recently launched theoutnet.com, her outlet site, with which everyone is a touch obsessed. WSJ. also explores the glorious world of online sales at Gilt Groupe, and those traditionally gauche places, outlet stores. (Our best shoe finds ever were from the Neiman Marcus outlets in Dallas. Just saying.) All of these sites and stores are changing fashion dramatically. Some designers are digging in their heels and not dropping their prices. But others are adapting and giving consumers what they want. Shocking idea. Balenciaga has a new outlet at Woodbury Common, and Oscar de la Renta launched an outlet section on the company’s website. And though designers were furious about the steep markdowns at department stores late last year, consumers loved them. You can’t really argue with what the customer wants. So while consumers may not pay full price again, luxury can survive this economy. That is, if, like everything and everyone else right now, it learns to adapt. Welcome to Darwinism.